The Battle of the Titans

I was looking for a rally to retrace the major move from last week but I didn’t expect it to happen with 51 handles BEFORE the market opens.

Wow. I never saw that before.

Sooner or later we will fill that gap and then new lows. A double bottom before the double top or a double top first is yet to be determined but the Titans are battling it out right now.

But before we get in to today’s action you may want to take note of the lock limits for the ES. I have the limits down on my work sheet but I never thought I would need limits up! There is a 5% lock limit up on overnight trading that is released on the bell. We came within 3 ticks of that this morning which also happens to be right at a great 1 tick setup but if you are wrong and the market trades to the limit you’re sitting on a short trade that’s lock limit up. That is a place I never ever want to be regardless of the potential reward.


Daily Price Limits RTH: Successive 10%, 20%, 30% limits (downside only)
ETH (overnight): 5% up or down


There are several houses that are standout players. Goldman has always been one of them. They have the best analysts and the wealthiest clients. Other standout players come and go but recently Swiss bank has been very active. If you recall me mentioning they have been very aggressive to the downside before the crash.


This morning we had very aggressive buyers off the bell. Goldman kept buying totaling 1000 cars in the first 5 minutes. Then JP came in buying 600 cars at 9:43. This was the last of the aggressive buying and the high of the day. The locals were size short as they didn’t lay anything off in the mini that I could tell. After a little local push- here comes Swiss. They sold and sold size and continued to do so which completed the IB.

No other stand out sellers came in, just Swiss, and after a test of the IB we rallied up but couldn’t take out the high so back down to test the low. With the Titans done taking their position we just auctioned around creating Value. The pit was packed most of the day as locals were expecting heavy trading that didn’t materialize. We did rally enough late day to settle above the OR but not enough to say we should seek more upside.

The Vix is in a good spot for active trading above 17 suggesting volatility but below 33- the “chaos level”. Breadth was pegged to the upside all day suggesting a pull back or resumption on Turn around Tuesday. Tick is rising suggesting continued up side and Arms is at a calming .64

I am still looking for more downside activity to test the low but I sure would like to know what Goldman is thinking right now. Regardless I will be long above and short below. Cant wait…….


Tim Mack